What is business activity and how does it work in Poland?
A business is any type of activity that aims to make a profit.
In Poland, it is possible to conduct business in various forms:
- one-person business activity
- a civil law partnership
- partnerships
- companies.
- Polish law allows citizens of the EU, the US and the Swiss Confederation to register businesses on the same terms as Polish citizens. Citizens of other countries may establish companies and partnerships in Poland, while one-person business activity (JDG) may be established only if they have an adequate residence title, such as:
- permanent residence permit,
- EU long-term resident permit,
- refugee status,
- temporary protection in Poland,
- a valid Pole’s Card.
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What are the steps to setting up a business in Poland?
Setting up a business requires several key steps. The first is to register the company in the Central Register and Information on Economic Activity (CEIDG). To do so, the entrepreneur must fill in the relevant form, which can be submitted online or in person at the municipal office.
Another thing to do is to register in the Social Insurance Institution (ZUS), which is necessary to ensure health and pension insurance for yourself and any employees. It is also worth considering registering as a VAT payer if you anticipate exceeding a certain revenue threshold or plan to cooperate with other companies.
Benefits of doing business in Poland as a foreigner
The Polish labour market is dynamic, diverse and offers many opportunities due to its membership of the European Union.
In Q1 2024, around 16% of applications to set up one-person business activity were made by foreigners. Most of them were Ukrainians. Belarusians, Germans, Italians and even Russians.
Some of these newly established businesses among foreigners are actually collaborations with one company on a B2B basis. However, many of these businesses, for example those founded by Ukrainians, offer services for their compatriots.
Many foreigners who have arrived in Poland in recent years are very entrepreneurial. They often emphasise that it is much easier to do business in Poland and there is less competition than, for example, in the former Eastern Block countries.
Some of them prefer to remain in the grey market because of concerns about complex legal requirements and controls. Some of them, however, set up companies officially, performing services aimed at their home market, but not only. A huge number of them achieve great success as entrepreneurs on the Polish market.
In addition, access to EU funds is an important element supporting the development of enterprises in Poland. Foreigners also often have the opportunity to apply for support that can help develop their business.
What are the most common challenges and pitfalls when setting up a business in Poland?
Setting up and running a business in Poland can involve great prospects and earnings higher than in a salaried job, but it can also be demanding.
A major challenge, not only for foreigners doing business in Poland, but also for domestic entrepreneurs, is the complex tax system. Entrepreneurs need to be aware of the many regulations and deadlines related to taxes, which can be overwhelming for new starters. Therefore, it is worth relying on a good accountant assistance right from the start. These services are not very expensive, and will help you delegate a lot of responsibility to a professional and avoid a lot of hassle when dealing with various institutions.
One of the most common problems faced by foreigners doing business is language barriers and cultural differences. However, just like anywhere else in the world – perseverance, openness and a positive attitude are invaluable. Such an attitude will allow any entrepreneur to create many beneficial business relationships based on mutual trust.
Summary: Is it worth setting up a business in Poland?
In conclusion, starting your own business in Poland requires diligence and knowledge of local regulations. However, with the right preparation and support, it is possible to succeed on the Polish market.